UK stocks set for weekly declines as oil prices soar
Oct 23 (Reuters) - UK stocks were set for weekly declines on Friday, as oil prices hit over five-month highs this week, weighing heavily on risk appetite, while investors parsed a slew of corporate earnings and economic data through the week.
The blue-chip FTSE 100 index .FTSE fell 0.5% to 10,670 points by 1020 GMT. The midcap FTSE 250 .FTMC was up 0.1%, but was set for its sharpest weekly fall in nearly six weeks.
Oil prices hit their highest levels in over five months, with Brent crude trading close to $114 a barrel. This lifted energy shares .FTNMX601010 2%
Aerospace and defence shares .FTNMX502010 dropped 4.1%, falling to their lowest levels since late May, with Rolls-Royce RR.L bottoming the FTSE 100 with a 6.4% slide
French rival Safran SAF.PA dropped 8% on worries that a slowdown in aftermarket sales growth could continue into 2027, with airlines cutting capacity amid high fuel prices
Bank .FTNMX301010 and healthcare .FTNMX201030 sectors fell 1% and 1.7%, respectively, further bogging down the index
Rising oil prices have spurred inflation concerns in the global economy, with domestic data this week showing price pressures increased more than expected in September
An interest rate hike by the Bank of England in November is largely priced in, with the data supporting the case
Elevated oil prices, growing bets on rate hikes and uncertainty ahead of the budget have set the indexes up for weekly declines
British retail sales volumes fell 0.4% in September from August, worse than the 0.1% decline expected by economists, data showed on Friday
Separate data showed consumer confidence plunged in October, its steepest monthly fall since the pandemic
Markets will be looking forward to finance minister John Healey's budget next week
Among individual movers, insurer Lancashire Holdings LRE.L fell 4% after Barclays cut its rating to "underweight" from "equal weight"